Report
Italy: The urgency is not to boost actual growth but potential growth
Due to weak productivity gains and population ageing, potential growth is very low in Italy, at 0% per year on average. Stimulating demand, which the Italian government is now doing, then becomes counterproductive: the extent of supply-side constraints prevents demand stimulus from being effective; the increase in the fiscal deficit drives up interest rates, which, on the contrary, weakens activity - as was seen in the second half of 2018. Italy’s economic policy should therefore aim to boost potential growth: support corporate investment, improve the education system.
Provider
Natixis
Based across the world’s leading financial centers, Natixis CIB Research offers an integrated view of the markets. The team provides support to inform Natixis clients’ investment and hedging decisions across all asset classes.
Patrick Artus
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